News and Insights


10 Dec

What is POS?

coffee shop credit card payment

Point of sale (POS) is the whole point of retail. It’s the technology that allows the right money to change hands, offset all the costs generated up to that stage in your processes and generate profit. Everything in your retail business leads up to this point, so getting point of sales right is critical to your organisation.

In this article we explore:

  • the meaning of POS
  • the technology that supports POS
  • what to look for in a POS system
  • how point of sale software can bring powerful business benefits

What is a Point of Sale System?

POS Machine

Simply put, POS is where your customers pay for goods or services from your company. This relies on having the right POS system in place which combines hardware and software so staff can record sales, charge and take money quickly, accurately and easily. An advanced  POS system also does a lot more than this, as we explain.

The Hardware

With the rise of food retail self-service, you’re probably familiar with the physical components of a  POS system but here’s a quick re-cap just in case:


  • Register screen – linked to a product database, the screen displays products as they’re scanned. It also enables employees to clock-in or log on via the POS software. Today, bulky screens are beginning to be replaced with tablets saving space and enabling mobile sales to take place.


  • Barcode scanner – as barcodes are scanned they pull product information from the store’s point of sale software. Each price is added to the subtotal and should reflect any special offers or discounted rates. This automates the checkout process removing the need for retailers to price products manually. More advanced retailers link barcodes to inventory management systems so stock levels are automatically adjusted.  
  • Card reader – as the amount of money spent on cards overtook cash for the first time in 2017, card readers are critical components of a POS system. They need to be secure, meet relevant laws and protect customer data.
  • Receipt printer – receipts provide more information than a snapshot of a customer’s purchase: they can also be used to print out sales totals, hours worked and other data. More businesses are moving to email or SMS receipts, but for now paper receipts are a point of sales stalwart.
  • Cash draw – this may not be required at some point in the future and some retailers are already moving away from cash entirely. Choosing to incorporate tablets with card payment technology could be the future.



Different businesses require different hardware setups to meet their needs. For example, food retailers often need scales so employees – and increasingly customers themselves – can weigh fruit and veg.

The checkout hardware is the brawns of a POS system whereas the point of sale software is the brain. It can be provided in one of two ways:


  • On-premise – licenses are purchased for the relevant point of sale software which is installed on a computer system or servers. This is a traditional approach which requires IT support to ensure everything runs smoothly.


  • Cloud-based – as with other cloud-based software, digital POS software is accessed and used via the internet. These systems will work offline, so if the internet breaks your system will continue to work syncing with your cloud storage as soon as the internet is back up again. Also known as software-as-a-service (SaaS) POS solution, you aren’t responsible for updating and maintaining the software: this is the responsibility of the cloud provider. Cloud-based point of sale software also enables the use of mobile devices like tablets allowing point of sales to move beyond a traditional fixed till point.



In What Way is a POS System Helpful?

Taking money is the raison d’etre of any business which means POS systems are a critical element of any retail setup.

Using the right POS system can have a really POSitive effect on your business by automating a whole series of workflows and providing you with improved organisation and better control over your operations.

That’s because the right POS software means you know exactly what you’ve sold by the hour, day or year. It can also link with your warehouse system so you know how many products are on-hand and when you need to order in more stock. And it’s your point of sale software that tells you the all-important data like how much money you’ve taken and the amount of profit.

What Should I look for in POS Software?

When looking for a POS system, it’s important to ensure that any new hardware and software will work with wider business applications, like your supply chain or warehouse systems. The aim of a POS system is to streamline business processes so they should include:

  • sales recording, analysis and reporting capability to help you make informed business decisions
  • customer management tools that:
    • log purchases
    • make the purchase history available to employees
    • keep in touch with customers with connected marketing applications
  • Inventory management to:
    • provide real-time stock level reports
    • help managers determine which products to order, when and how many
  • Employee management tools that:
    • enable employees to log in and out of the terminal
    • link with scheduling and payroll systems

By investing in a POS system that ticks all these boxes, you’ll automate previously labour-intensive processes. Which is why quality point of sale systems help retailers make huge efficiency savings as we explore in the next section.

In What Way is a POS System Helpful?

There are many ways a POS system can support your retail business. By automatically gathering data, sharing it with other relevant systems and creating reports, it allows managers to carry out improved analytical thinking and make better decisions.

Take inventory: with large amounts of data the system can spot patterns in sales, analyse reports and predict future trends more precisely. Which will allow you to ensure appropriate stock levels keeping shelves full and customers happy without over-ordering.

Point of sale software also reduces paperwork as bills, orders, sales figures and reports are all automated. And the sales themselves are also far quicker thanks to barcode technology and tap-and-pay card capability. By enabling your staff to make more sales per hour with fewer checkouts, the better your bottom line.

And it’s not all about in-store efficiency: client communications can also be improved by POS software. By gathering customer details as they complete their purchase, you can create personalised offers at scale or tailor communications to make them more relevant.

A modern POS system is an incredibly powerful tool for retailers. Investing in cutting-edge technology does require additional finance but it will be repaid through:

  • improved efficiency
  • more joined up systems
  • better reporting and predictive analysis
  • leaner checkout processing
  • enhanced after-sales service for your customers

Want to know if there’s any point in updating your point of sale software? Talk to one of our consultants to find out on +44 (0) 808 200 7375.

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